Question

The inventory at June 1 and costs charged to Work in Process - Department 60 during June are as follows: 3,800 units, 60% completed $ 60,400 Direct materials, 32,000 units 378,000 Direct labor 274,000 Factory overhead 168,000 Total cost to be accounted for $880,400 During June, 32,000 units were placed into production and 31,200 units were completed, including those in inventory on June 1. On June 30, the inventory of work in process consisted of 4,600 units which were 85% completed. Inventories are costed by the first-in, first-out method and all materials are added at the beginning of the process.

Prepare a Process Cost Report using a FIFO costing method

Answer 1

Solution:

Cost Charged to production
Total Cost of Beginning Work in process	$60,400
Total Costs incurred this period	$820,000
Total Cost to account for	$880,400
Total Cost Accounted for	$880,400
*Difference due to rounding cost/unit	$0
Unit Reconciliation
Units to account for:
Units in Beginning work in process	3800
Units Started this period	32000
Total Units to account for	35800
Total units Accounted for:
Units in Beginning work in process completed	3800
Units Started and Completed	27400
Units in ending work in process	4600
Total Units accounted for	35800
Equivalent units of production (EUP) - FIFO method
	Units	%Material	EUP-Material	% Conversion	EUP- Conversion
Beginning units completed this period (A)	3800	0%	0	40%	1520
Units Started and Completed (450000-100000) (B)	27400	100%	27400	100%	27400
units of Ending work in process (D)	4600	100%	4600	85%	3910
Equivalent units of production (C+D)			32000		32830
Cost per EUP			Material		Conversion
Costs incurred this period (Total Costs)		Costs	$378,000	Costs	$442,000
/Equivalent units of Production		EUP	32000	EUP	32830
Cost per Equivalent unit of Production			$11.81		$13.46
Cost Assignment and Reconciliation
Beginning Inventory Cost:				$60,400
Cost to Complete Beginning Inventory	EUP	Cost per EUP	Total Cost
Direct materials	0	$11.81	$0
Conversion	1520	$13.46	$20,464
Total Cost to complete Beginning Inventory				$20,464
Total Costs of units in Beginning Inventory				$80,864
Cost of units started and completed	EUP	Cost per EUP	Total Cost
Direct Material	27400	$11.81	$323,663
Conversion	27400	$13.46	$368,894
Total Cost of units started and completed				$692,557
Total cost of units transferred out				$773,421
Cost of ending work in process	EUP	Cost per EUP	Total Cost
Direct Material	4600	$11.81	$54,338
Conversion	3910	$13.46	$52,641
Total Ending work in process				$106,979
Total Costs accounted for				$880,400